Retail Strategy and Competitive Analysis

The assignment delves into a detailed analysis of a specific retail business, likely employing Porter's Five Forces framework to assess its competitive environment. Students are tasked with applying various strategic tools like SWOT analysis and PESTLE analysis to understand the business's internal strengths and weaknesses, as well as external opportunities and threats. The case study encourages students to evaluate the retailer's overall strategy in light of market trends and competition.

MARKETING STRATEGY AND
APPLICATION

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK...............................................................................................................................................1
Q1 FUNCTION AND STRUCTURE OF SAINSBURY................................................................1
Working of structure and function in order to achieve organizational goal...............................3
Problems with current structure and functions............................................................................4
Q2 PESTLE FACTORS..................................................................................................................4
Q3 SWOT ANALYSES..................................................................................................................7
Q4 CONCLUSION AND RECOMMENDATIONS.....................................................................10
Conclusions...............................................................................................................................10
Recommendations.....................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
In the modern ear each firm implement effective marketing strategy in order to
accomplish its fundamental goals. It concentrates on reaching to the mass audience and
satisfying their needs. Current strategy is based on Sainsbury which is operating its business in
the retail industry (Martínez, Galván and Alam, 2017). Customers are the key stakeholder of the
business and entity aims to offer them satisfactory products so that they retain in the business for
longer duration. Present report will discuss function of Sainsbury and its organizational structure.
SWOT and PESTLE analyses of the company will be done in this assignment. It will explain
customer relationship management and its importance for the firm.
TASK
Q1 FUNCTION AND STRUCTURE OF SAINSBURY
Functions of Sainsbury
Each organization has to perform several functions that supports in smooth running of
business. Main objective of Sainsbury is to enhance its revenues and retain its workers in the
workplace for longer duration. In order to achieve this objective Sainsbury performs various
functions, these are explained as below: Procurement: This department deals with Bid issues, request for proposal and issue
contracts. It is accountable for expenditures of business and managing supply chain of
the company (Baalbaki, Hoffman and Gilliard, 2017). Finance: It is essential function of business, finance manager of the company is
responsible to make proper investment decision, effective allocation of resources, budget
formation. Sainsbury maintains relationship with many stakeholders and it aims to keep
them satisfied. It utilizes its capital raising sources well so that it can manage its risk and
can enhance its revenues. Marketing and selling: It is the department which continuously work for raising sales
volume of the firm. It promotes the product and services in the market in such manner so
that more people take interest in company and use its services. Marketing manager
promotes the brand by adopting effective marketing strategy and train seals team so that
they can deal with consumers well (Smith, Rupp, and Offodile, 2017).
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 IT: Information function is another function of the cited firm in which IT team manage
records and circulate necessary information to relevant persons on time. Human resource: HR function of company works to motivate employees, hire skilled
employees and retain them in the workplace for longer duration. HR manager of the
Sainsbury selects the deserving candidates in the organization and train them as well.
Individual monitor their performance and accordingly give them reward and recognitions.
This helps the company in motivating staff members and retaining them in the
corporation for longer duration (Kumar and Bansal, 2015). Research and development: It is the department which conduct market research and
collect information about needs of consumers and market demand. By this way marketing
department and other department makes changes in their working process and try to meet
with the demand of market.
Organizational structure
There are several types of organizational structure that are used in different organizations.
These are explained as below:
Divisional
It is the type of structure in which firm group each function into division. All divisions
are allotted necessary resources so that they can perform their work effectively. It is beneficial
for the big size firms because it offers them operational flexibility. If one division fails to
perform them then it does not impact on entire business. Sainsbury adopts divisional
organizational structure (Betz, 2016).
Functional
It is another type of structure in which firms organize different department and all these
departments perform different functions in the firm. All department communicate with other
department so that goal of the firm can be accomplished.
Product
It is another type of organizational structure in which people are organized for managing
different products. All employees have to report to the single authority. It organizes products by
considering different categories (Greenspan, 2015).
Matrix
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It is the hybrid structure which is made up with the combination of divisional and
functional structure. It supports in resource and knowledge sharing to all divisions. All
employees work to accomplish main goal of the company rather than specific department
objective (Song, Wang and Zhu, 2018).
Working of structure and function in order to achieve organizational goal
The main goal of Sainsbury is to enhance its revenues and retain skilled workers in the
workplace for longer duration. Structure and functions of the company support the business in
accomplishing its objectives in effective manner. Sainsbury is the trusted retail brand that
continuously work to enhance satisfaction level of customers. Cited firm adopts divisional
organizational structure that support the firm in conducting operations well. Each division
separately perform their duties and each division is specialized in their work. Thus, it helps in
minimizing errors and effective utilization of resources. Every department in the organization is
independent thus, they take quick decisions so that entity can improve its operational efficiency
and can enhance its market performance (Keller, Daronco and Cortimiglia, 2017). As Sainsbury
has various departments such as marketing, finance, IT, human resource etc. with the help of
divisional structure overlapping of different activities can get minimized in the workplace that
supports each department in performing their duties well and accomplishing the main goal of the
firm. For instance Sainsbury's marketing department is working separately. All the team
members have great knowledge about this field and they make quick decision. They circulate the
information related with consumers needs and requirements to all department and coordinate
with them. That helps in making necessary changes in the workplace so that organization goal ca
be achieved.
Effective coordination between all department and quick decision making help the entity
in performing well in the market and attracting new consumers towards the firm. As all
departments are working separately so no conflict arise in the business unit and all team
members get equal freedom and flexibility to make their decision. That encourage them and they
feel satisfied. By this way skilled workers retain in the business unit for longer duration and they
contribute well in accomplishing objective of the corporation (Erskine and et.al, 2015). Each
division and department concentrate on enhancing profitability and reducing the cost. That is
suitable mixture and assist in ensuring that organizational goal of Sainsbury can be obtained.
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Problems with current structure and functions
There are several issues faced by Sainsbury due to implementation of divisional structure
and performance of several functions. One of the major problem that is faced by cited firm is it
increase cost of the firm. As all department work separately thus, company has to allocate
resources to all departments This create situation of duplication of resources and enhance
wastage as well. That increase cost of the entity to great extent. As one of the major function of
Sainsbury is to recruit right candidate in the workplace and train them in such manner so that
individual can perform their work effectively (Armstrong and et.al, 2015). But as different
sections are here so it is very difficult for HR manager to understand specific need of particular
post and organize training session for different candidates those who are going to work in
different departments. If any workers leave their job them entity has to recruit new candidate
because through job rotation this post can not be filled soon. Thus, it is costly process and
enhance burden on the Sainsbury.
Due to divisional structure and different function it becomes difficult for the manager to
supervise working performance of each candidate. Overlapping of functions is another issue that
is raised due to this structure and functions of business (Solomon and et.al, 2014). It is very
difficult for the firm to control over each separate section. If one department fails to perform its
work well then it will create difficulty for other departments. As each department is self centred
and concentrate more on own profit rather than common organizational goal hat some times
create problem in achieving goal of the firm.
Q2 PESTLE FACTORS
Customer relationship management
Customer relationship management (CRM) is the practices and strategies of the firm to
manage its relationship with customers. In the modern era it becomes very difficult to retain the
consumers in the firm for longer duration. There are many competitors of the brand those which
are offering similar services to them at affordable rates. In such condition mind of consumers get
influenced and they move towards other firm. CRM is the techniques that helps the entity in
making people loyal and holding them in the workplace for longer duration. Sainsbury's main
aim is to enhance satisfaction level of clients for that it provide them products and services as per
their requirements so that they feel happy and come to the firm again and again (Sheth and
Sisodia, 2015). Customer relationship management is the beneficial tool that supports Sainsbury
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in managing its sales and marketing functions. Tesco, Asda etc. are competitors of Sainsbury
those which are offering extremely well services to clients. In such condition company has to
face difficulty in retaining its clients in the firm for longer duration. For that it always tries to
develop healthy relationship with them (Lusch and Vargo, 2014). Company communicate with
them through social networking sites. It asks their feedback and their experience with the entity.
People give their valuable suggestions that supports the entity in identifying needs of consumers
and offering them products as per their requirements.
Pestle factors
PESTLE analyses is the tool that supports in identifying the external market position of
the firm. With the help of this technique company can identify the various external factors that
impact on the business performance.
Political factor
It is considered as one of the major element that impact on working performance of the
business unit to great extent. As cited firm get influenced by political condition of the nation.
Brexit is the major issue that has affected over all condition of the market, after that revenues of
the firm get affected (J Sainsbury SWOT & PESTLE analysis, 2017). Changing laws and
regulations impact on the business unit and create pressure on the business to make changes in its
working performance. Due to this company some times get fails to fulfil needs of consumers and
providing them satisfactory services as well.
Economic factor
It is another major element that impact on the customers relationship management of the
firm. As changes in economic values impact on the purchasing power of consumers to great
extent. Inflation and deflation impact on the purchasing power of client. If government enhance
interest rate then cited firm have to increase its product prices in such condition satisfaction level
of consumers get decreased because they feel unable to get satisfactory products at affordable
cost. But currently economic condition of UK is very good and people have adequate job
opportunities and income sources (Solomon and et.al, 2014). That increase their purchasing
power. Thus, they invent good amount in supermarket that help the company in conducting its
business in smooth manner.
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Social factors
Social factors are another major external factor that impact on the firm's performance and
satisfaction level of consumers \as well. Preferences, social values, culture impact on the
consumer behaviour. Sainsbury has to maintain these elements in order to sustain in the market
for longer duration. Sainsbury's is maintaining the relationship with suppliers and ordering goods
from such suppliers those who are socially accepted (J Sainsbury SWOT & PESTLE analysis,
2017). This helps the cited firm in proving satisfactory products to consumers and gaining their
trust as well.
Technological factor
It is one of the main element that affect entire operations of the business. Sainsbury is the
largest retail firm which has mass number of consumers. It operates its business across the world.
It has good knowledge of technologies and adopt the latest technique in the workplace so that it
can deal with the consumers well (Erskine and et.al, 2015). It ensures that it does not make any
mistakes and provide goods to the consumers without fault. It is engaged in the online shopping
that helps the firm in gaining high profit in the market and gaining competitive advantage as
well.
Legal factor
National minimum pay scale, merchandising laws etc. affect the business performance. In
the condition of modification in these laws it becomes essential for the firm to make changes in
current practices as well. That help the entity in running business legally and avoiding
complications (Kumar and Bansal, 2015).
Environmental factor
Cited firm always conduct business in ethical manner , it concentrates on environmental
factors and provide environmental friendly products and services to the consumers. It supports
business unit in earning high reputation in the market.
All these factors impact on customer relationship management to great extent because if
cited firm fail to make changes in its practices as per the necessity of the government norms then
consumer may feel demotivated and it will affect firm's relationship with the consumers. That
can decrease trust of users and they will move towards other brand (Song, Wang and Zhu, 2018).
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Q3 SWOT ANALYSES
Customer relationship management strategy of Sainsbury are effective and support the
entity in increasing its revenues and gaining competitive advantage. By developing healthy
relationship with consumers cited firm get to know about needs of clients and this information is
circulated to the internal departments that helps in enhancing internal communication. By this
way all people become able to perform their work effectively. CRM is the best approach that
helps in improving team collaboration and efficiency of service client better. Employees of the
company get more knowledge about market and they coordinate with each others well that
supports in enhancing their satisfaction level. CRM applications support Sainsbury in
customization of their offering as per the taste and preferences of clients. That improves quality
of products and services as well. By this way people become loyal towards the brand and they
become frequent buyers of business unit. There are many other benefit that can be get by
implementing CRM approach in the workplace. It improves pricing strategy, enhance sales
volume and efficiency of sale force, it increases ability of the firm to target to the potential buyer
of the corporation so that overall goal of the corporation can be achieved.
Customer service, sales force automation, campaign etc. are key elements of
CRM practices. Sainsbury offers quality services to its clients and provide them after sales
services that increase trust of the persons and they become loyal towards the brand. Sales and
marketing team approach to the potential buyers and know their perspective for business. They
target specific group of people those who can buy company's products frequently. This campaign
supports the cited firm in analysing needs of them and developing healthy relationship with the
buyers.
SWOT analyses is the technique that helps the firm in identifying internal working
performance of the firm. It supports in measuring internal position and making necessary
strategies for the growth of the business unit. Sainsbury is the leading brand in the retail industry,
it is operating in many countries. It has large number of customers those who are loyal towards
the firm.
Strength Weakness
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 Strong brand image
 High employee strength
 Excellent advertisement and marketing
strategies Strong financial position
 High dependency on UK market
 Stiff competition
 Poor recruitment strategies
Opportunities
 Globalization
 E-commerce Use of advance technologies
Threats
 High competition
 Fluctuating food prices
Strength Strong brand image: Sainsbury is working in the retail industry, it has earned strong
brand reputation. It offers quality products to its consumers that enhance trust of the
consumers on the entity. High employee strength: Company has hired many employees in the workplace thus,
recently its number of employees are too high. All its workers contribute well in
accomplishing organizational goal. Store chain of cited firm understand significance of
human resource thus, it invests large amount in recruiting candidates in the workplace. It
provides them training accordingly so that these people can serve consumers well. These
employees provide satisfactory services to consumers that enhance satisfaction level of
clients to great extent. Excellent marketing strategies: Sainsbury adopts effective marketing strategies. It takes
supports of online marketing tactics and adopts CRM approaches. This helps in
developing healthy relationship with consumers and circulating the information to mass
audience. Through Facebook and Twitter it makes people aware with the offers that are
provided by the cited firm so that consumers take interest in the firm and they buy retail
products from its stores. Strong financial positions: Sainsbury is the multinational supermarket firm, it has strong
supply chain. Recently company has opened 47 new stores at different geographical
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locations. Its revenues have been increased by 15% in this year as compare to previous
year. It has adequate financial resources that support the firm in conducting business
operations effectively and providing quality products to customers.
Weakness High dependency on UK market: Sainsbury is highly depended upon the UK market.
Though it is operating globally but most of its suppliers are belonged from UK market.
Some times it creates problem for the business because when these suppliers increase
their cost then entity also has to enhance its products prices. In such condition consumers
of the firm move towards the other brand. It impacts on overall sales volume of the entity
to great extent. Stiff competition: Tesco, Asda are the major competitors of the firm. These entities are
offering high quality products to customers at reasonable prices. They also provide
additional gift or rewards to buyers that influence the mind of consumers and they think
to buy their products from these entities. This is the major issue or weakness in the
Sainsbury because due to stiff competition cited firm has to make changes in its working
performance so that it can make unique image in the mind of clients and can retain them
in workplace for longer duration. Poor recruitment strategies: Sainsbury is hiring large number of new candidates in the
workplace but it is unable to recruit right candidate in the workplace as per the
requirement of the firm. Due to this, most of its staff members leave job soon or many of
them are terminated by the entity due to their poor performance. Poor recruitment
strategies enhance cost of the firm and create difficulty for the business unit.
Opportunities Globalization: Sainsbury has recently opened its supermarket store in China. China has
the fastest growing economy thus, company has high chances to earn more profit from
this market. Similarly, cited firm can enter into international market and can provide wide
range of products to mass audience. This can help the cited firm in enhancing its sales
volume and spreading its brand image across the world. E-commerce: Sainsbury can enter into e-commerce business or can extent its business by
using online platform. In the modern era people like to shop from online medium because
it is time saving option and they can get various benefit by purchasing online. By entering
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in e-commerce cited firm can be able to expand its business internationally and can
enhance its revenues to great extent. Use of advance technologies: It is another opportunity for the firm that it can use advance
technology in order improve its services and gaining competitive advantages.
Threats High competition: It is the biggest threats to the firm that impact on its sales and create
difficulty in sustaining in the market for longer duration.
 Fluctuating food prices: Due to changes in food prices cited firm has to face issues that
enhance its sales and overall profitability to great extent.
Strength, weakness, opportunities and threats of Sainsbury impact on its customer
relationship management to great extent. As company has large number of employee that helps
the firm in dealing with mass audience and providing them quality services on time. If any
consumers raise any complains then due to availability of large employee it becomes able to
resolve their quarries soon. It enhances relationship with them to great extent. Strong financial
position of the business supports in providing high quality products to them and satisfying their
needs. By this way consumers become loyal towards the firm and become frequent buyers of
entity. On other hand high dependency on UK market some times it fails to delivery services to
consumers on time. They turn mind of customers and they think to buy retail products from other
organization. If Sainsbury enters into e-commerce business then it will support in developing
healthy relationship with consumers and proving them immediate services. This will develop
healthy relationship with customers and it will be able to accomplish its goal soon.
Q4 CONCLUSION AND RECOMMENDATIONS
Conclusions
From the above report it can be concluded that Sainsbury has strong market reputation
and it is able to perform well in the market. Structure and function of the firm help the entity in
accomplishing its goal. Entity has to look at the internal and external factors that impact on the
business and unit and have to maintain relationship with consumers. This is the way through
which organization can retain its consumers in the workplace for longer durations and can earn
high profit. Effective utilization of resources and use of advance technology can support the
entity in improving performance of the entity and gaining competitive advantage.
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Recommendations
 Sainsbury should provide training its is staff members so that they can understand needs
of consumers and can deal with them effectively. By providing training to employees
skills of workers can be increased and they will be able to perform well in the market.
 Sainsbury should concentrate more on government policies and should make necessary
changes accordingly. By this way it will be able to conduct its operation smoothly. And
will be able to minimize future complications.
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REFERENCES
Books and journals
Armstrong, G. and et.al., 2015.Marketing: an introduction. Pearson Education.
Baalbaki, S., Hoffman, D. L. and Gilliard, D. J., 2017. The Fitbit Addiction: Will This
Disruption Last?. Journal of Marketing Development and Competitiveness. 11(4). pp.86-
103.
Betz, F., 2016. Strategic Thinking: A Comprehensive Guide. Emerald Group Publishing Limited.
Erskine, A. and et.al., 2015. The Home Depot: A Competitor’s Strategic Audit, A Case Study.
In Global Enterprise Management (pp. 171-189). Palgrave Macmillan, New York.
Greenspan, R., 2015. Walmart: Five forces analysis (Porter’s model). Panamore Institute.
Keller, F. H., Daronco, E. L. and Cortimiglia, M., 2017. Strategic tools and business modeling in
an information technology firm. Brazilian Journal of Operations & Production
Management. 14(3). pp.304-317.
Kumar, P. and Bansal, S., 2015. SWOT ANALYSIS: WHAT DOES FDI HOLD FOR THE
INDIAN RETAIL SECTOR IN 21TH CENTURY?. International Journal of Research in
Management, Economics & Commerce. 5(1).
Lusch, R. F. and Vargo, S. L., 2014. The service-dominant logic of marketing: Dialog, debate,
and directions. Routledge.
Martínez, A. B., Galván, R. S. and Alam, S., 2017. Financial Analysis of Retail Business
Organization: A Case of Wal-Mart Stores, Inc. Nile Journal of Business and
Economics. 3(5). pp.67-89.
Sheth, J.N. and Sisodia, R.S., 2015. Does marketing need reform?: Fresh perspectives on the
future. Routledge.
Smith, A. D., Rupp, W. T. and Offodile, O. F., 2017. Amazon. com, Inc.: Retailing Giant to
High-Tech Player?(pp. 3-6).
Solomon, M. R. and et.al., 2014. Consumer behavior: Buying, having, and being (Vol. 10).
Pearson.
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Song, Y., Wang, H. and Zhu, M., 2018. Sustainable strategy for corporate governance based on
the sentiment analysis of financial reports with CSR. Financial Innovation. 4(1). pp.2.
Online
J Sainsbury SWOT & PESTLE analysis, 2017. [Online]. Available through
<https://www.swotandpestle.com/j-sainsbury-plc/>
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